Obliged continued payments of wages and salaries in the event of closures?

Currently, the question of whether employers can suspend payments of wages and salaries due to closed business has not been conclusively clarified due to the lack of legal regulation.


The employer's obligation to continue to pay wages and salaries in the event of closures under the Austrian Epidemics Act is no longer applicable due to the new Austrian COVID-19 Measures Act.

The currently circulating legal opinion that employers are exempt from their obligation to continue to pay wages and salaries according to Section 1154b Austrian Civil Code (ABGB) for the period of the closure due to the pandemic will probably no longer be accepted as of Friday March 20, 2020 (see below), because a new law will probably regulate this uncertainty.

This legal view stated that work must be stopped due to force majeure, which affects not only the specific employer but the general public. The current pandemic must undoubtedly be seen as such a force majeure. This legal opinion is also supported by the decisions of the Supreme Court of Justice (9ObA202/87 and 9ObA27/88). According to the Supreme Court of Justice, the employer's obligation to pay remunerations does not apply in the case of extensive force majeure, which also affects the general public. Here, the Supreme Court of Justice mentions epidemics, war, revolution and terror, which are not only directed against the company. Without any doubt, the current COVID-19 pandemic can be described as an epidemic.

According to another - more employee-friendly - point of view, it is not absolutely clear whether or not employers can refer to force majeure since the government has now installed a new short-time working scheme and a crisis fund, which means that the federal government is indirectly (instead of directly, as was the case with the Epidemics Act) covering remuneration costs.

On March 18, 2020, the Director of the Austrian Chamber of Labour Vienna, Christoph Klein, informed in a mailing that the Austrian Social Partnership and the Federal Government had agreed on a solution to this problem. On Friday, March 20, 2020, the National Council will pass a law which "clarifies that employees of those companies affected by the imposed entry restrictions will continue to receive their salaries or wages".

Even though employers may be exempted from the obligation to continue to pay wages and salaries in times of crisis - as described above - we highly recommend waiting until after the new law has been enacted before deciding whether or not remunerations will be paid. Based on the wording of the notification issued by the Austrian Chamber of Labour Vienna, we believe it is very likely that employers will be obliged to continue to pay wages and salaries.

For further information, please contact the author of this article: Attorney Mag Christian Kux